Papua New Guinea’s property developers have been busy renovating properties and putting the finishing touches to new projects, including Marriott- and Hilton-branded executive apartments, as the sector gears up for greater economic activity.

Steamships’ new Harbourside South development in Port Moresby, featuring the Marriott Executive Apartments, was officially opened on 15 March. Credit: Steamships

Occupancy and room rates at Papua New Guinea’s premier hotels and apartments have already bounced back from their COVID slump, and property managers are preparing for a fresh surge in demand as major resource projects ramp up.

In Port Moresby, the developers of the Marriott Executive Apartments at the new Harbourside South building and the Hilton Residences at Star Mountain Plaza are expecting strong demand as they start to welcome guests in the second quarter of this year.

“The retail units are close to fully tenanted and we have very strong indications for the Marriott Executive Apartments,” says Rupert Bray, Managing Director of Steamships Trading Company, the company behind Harbourside South.

“The vision for Star Mountain Plaza is that you’ll be able to enjoy the same level of services as in a mall in Brisbane, Cairns or Singapore”

While demand will be spurred by a final investment decision (FID) on the TotalEnergies-led Papua LNG project, hoped for later this year, hotel operators say they’re already moving beyond the boom-bust of previous resource cycles, by refining the types of rooms they offer and injecting fresh energy and local character into food-and-beverage options that appeal to PNG’s growing middle class.

“FID is going to have a positive impact, not just for Marriott but for every other provider of hotels, offices, or industrial spaces. But what’s interesting this time is that there is also some post-LNG growth,” says Russel Sy, Chief Executive Officer of Steamships subsidiary Pacific Palms Property, which is managing Harbourside South.

Retail, Restaurants

Hilton Residences, stage two of the Star Mountain Plaza development in Port Moresby’s Waigani administrative district, has started welcoming long-stay guests to its 180 rooms, which range from studios to one-, two- and three-bedroom apartments.

The Hilton Residences, stage two of the Star Mountain Plaza development in Waigani, also feature a restaurant and co-working facility. Credit: Godfreeman Kaptigau

The project’s third phase will include a four-level retail mall with restaurants, cinemas and an additional 10 storeys for accommodation, according to the head of state-owned Mineral Resources Development Corporation, which fronts the consortium of landowner funds behind the project.

“The vision for Star Mountain Plaza is that you’ll be able to enjoy the same level of services as in a mall in Brisbane, Cairns or Singapore,” says Augustine Mano, Chief Executive Officer of MRDC.

Marriott and Hilton will provide competition to popular long-stay properties including the Crowne Plaza Residences, managed by InterContinental Hotels Group (IHG), which hosts residents on 6- or 12-month contracts while also maintaining an inventory of short-stay rooms for members of its IHG Rewards loyalty program.

“We don’t sell all our rooms because we have so many guests that need short-term accommodation,” explains Mauro Leone, Area General Manager at IHG PNG. “It would be very easy for us to lock it up but then we’d have so many IHG Rewards members that wouldn’t be able to get in.”

Occupancy at the Crowne Plaza, in Port Moresby’s CBD, exceeded 90 per cent in 2023, and Leone says “there’s a waitlist of people wanting to stay.”

The company is due to commence a K30 million, 18-month renovation of 152 rooms in the two oldest sections of sister property, the Holiday Inn and Suites, in early 2024.

Meanwhile, Pacific Palms Property is renovating its Whittaker and Windward apartments in Port Moresby, and refurbishing its Blaikie Apartments in Lae.

Huge investment

PNG’s largest hotel, The Stanley Hotel and Suites, which offers over 400 hotel-style rooms and apartments in Port Moresby’s Waigani district, is planning a ground-floor renovation that will include a refurbished lobby, reflecting the character of local areas and traditions.

Further ahead, plans have been announced for a K840 million Radisson Blu resort, mall and residences in Port Moresby’s planned Paga Hill tourism precinct, where the 83-apartment Paga Hill Paradise is already under construction.

“We are not entirely dependent on the mining and petroleum sector, nor are we hanging our hat on the next boom.”

Smaller property companies have also added serviced-apartment options, including Credit Corporation, the finance company that also owns the premium Era Matana Estate and family-oriented Era Dorina Estate in Port Moresby.

“The board was thinking of selling these properties in 2022, but have since changed their mind,” says Brent St Hill, the company’s General Manager, Properties. “Now we are looking at a huge investment in 2024, including K10 million to be spent on Era Dorina.”

While Credit Corporation is among many property owners that count TotalEnergies as a client, St Hill echoes the view of other industry players, who see long-term growth coming from across the economy: “we are not entirely dependent on the mining and petroleum sector, nor are we hanging our hat on the next boom.”

A version of this article was first published in the 2024 annual print edition of Business Advantage PNG, released this month by Business Advantage International.